You should never buy insurance without first taking the trouble to compare annuity rate offers from several different companies. This will definitely prevent you from running the risk of accidentally buying high-cost insurance.
Millions of people needlessly pay unnecessarily high interest rates because they were too lazy to try to compare annuity rate offers. For instance many people don't realize that a variable annuity actually has higher fees and sometimes-higher interest rates then a fixed rate annuity.
Just to remind you of the differences between types of annuities, a fixed annuity pays you a guaranteed rate of interest and a variable annuity helps you invest in a portfolio of mutual fund type accounts. There is also a third type of annuity called an equity-indexed annuity. It is like a mating of the two types and offers a minimum rate of interest as well as the opportunity to invest your money in a portfolio as well. Equity indexed annuities are the hardest plans to compare simply because they are complex and marketed as being risk-free when in fact the opposite is often true!
Another unfortunate yet common consequence of neglecting to compare annuity rate offers is settling for the first deal that comes your way. Many people do this just to get the whole tedious job of comparing annuity rate offers over with. This could be a big mistake, especially if you don't read the fine print. For one thing you might end up paying really high fees should you decide to withdraw your money one day.
Another problem is that you are often stuck in the deal that you chose in the first place as there could be very high penalties for withdrawing your money early. This makes it almost impossible to get ahead financially even if you did have a better annuity rate offered from another company.
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